Democrats in the Colorado legislature passed a bill Tuesday to ban colleges and universities from withholding diplomas or transcripts because of a student’s unpaid debt.

The state Senate approved House Bill 1049 in a 20-13 party-line vote, with Democrats in support and Republicans in opposition. The bill now heads to the House to confirm changes made by the Senate, and then, if approved, to Gov. Jared Polis for final consideration.

“House Bill 1049 is about the Colorado value of opportunity,” said bill sponsor Sen. Jeff Bridges, D-Greenwood Village. “Three-quarters of all jobs in Colorado require some kind of education beyond high school. And when you apply for those jobs, oftentimes, they want proof. Too many institutions of higher education right now are holding transcripts for ransom.”

If enacted, the bill would prohibit all higher education institutions from refusing to provide transcripts or diplomas to students who have unpaid fees, parking tickets or other minor costs. If a student owes tuition, financial aid or room and board fees, institutions couldn’t withhold transcripts or diplomas if the student needs them to apply for a job, credit transfer, financial aid or post-secondary opportunities, such as joining the military.

Opponents said the bill would encourage students not to pay their debts and could result in colleges and universities raising tuition fees to make up for the funds lost by not being able to withhold diplomas and transcripts.

During the 2019-20 school year, higher education institutions in Colorado recouped approximately $242 million in student debt through transcript withholding, according to the Colorado Department of Higher Education.

“There’s really a personal responsibility element that enters into this,” said Sen. Paul Lundeen, R-Monument. “You’re increasing the burden of higher education on everyone to protect a limited few who are choosing not to interact in a meaningful client-business relationship with the institution of higher education and paying off the obligation that they have.”

Supporters of the bill said the relief would allow students the ability to earn the money needed to pay back their debt. Nationally, 6.6 million students owe approximately $15 billion in unpaid debt, according to the Colorado Department of Higher Education.

“This is a simple step that we can take here in Colorado to make sure that students who are lower income are able to reduce those barriers, get a job quicker and pay down their debts,” said bill sponsor Sen. Brittany Pettersen, D-Lakewood.

The bill would also prohibit institutions from charging a higher fee or providing less favorable treatment to a transcript or diploma request because a student owes debt. Students from outside of the United States would be exempt from the prohibition.